With a subscription you create a closer bond with the consumer. What can you do with a subscription model? In this article 3 mentality changes for retailers and companies in consumer packaged goods.
From getting your dinner ingredients delivered weekly to binge-watching your favorite shows, subscriptions are a part of our daily lives. On average, consumers in the Netherlands have offer diversity and convenience, but subscriptions are also an opportunity to experiment with fewer commitments. Today’s consumers are less loyal to brands, but they’re not the only ones whose loyalty and dependency have shifted…
Retailers have become less brand loyal to their suppliers. In addition, Consumer Packaged Goods companies (CPGs) are more dependent on fewer retailers than before due to the consolidation of retailers. But retailers are also struggling. Their margins are relatively small, customers are more price-conscious and retailers are losing market share to online players.
To top it all off, start-ups are entering the market with fresh disruptive ideas and subscriptions. The result? CPGs are beginning to explore direct-to-consumer (D2C) strategies, particularly subscription models.
Well keep your promises
Subscription companieubscriptions create a closer connection with consumers. But the strength of that connection depends on how well a company delivers on its promises. CPGs suddenly need customer service and the ability to accept returns or ship replacements. In addition, companies must keep all the products they promised to deliver in stock, which email data complicates planning.
Subscription makes demand more predictable compared to regular e-commerce. For CPGs and retailers, the subscription model is still somewhat uncharted territory. How can these companies use this model to build more intimate customer relationships?
Learn from startups
A subscription is a good test to see how consumers respond. Startups often turn to subscription models. With a few hundred subscribers and the associated data, they can make a compelling case for scalability. Startups are hungry for data and are gathering input to refine their offering.
Retailers, on the other hand, are rethinking Дакле како можете исправно their offerings and subscription models less often, if ever. Subscriptions aren food and beverage, personal care, household products, and apparel. Closely followed by lists by toys, games, books, and, somewhat surprisingly, pet products. The possibilities seem endless. Retailers and CPGs need to stake a claim to their subscription space, or a startup will happily take it.
